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Retail sales per capita seems to be in a long term downtrend (but short term trends vary depending on periods selected - see graph below).

Year-over-Year Change - Per Capita Seasonally Adjusted Retail Sales

From the U.S. Census Bureau press release:

The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for June, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $457.0 billion, an increase of 0.6 percent (±0.5%) from the previous month, and 2.7 percent (±0.7%) above June 2015. Total sales for the April 2016 through June 2016 period were up 2.6 percent (±0.5%) from the same period a year ago. The April 2016 to May 2016 percent change was revised from up 0.5 percent (±0.5%)* to up 0.2 percent (±0.1%). Retail trade sales were up 0.7 percent (±0.5%) from May 2016, and up 2.4 percent (±0.5%) from last year. Nonstore retailers were up 14.2 percent (±1.2%) from June 2015, while Health and Personal Care Stores were up 8.4 percent (±2.1%) from last year.

The differences between the headlines and Econintersect are due to different approaches to seasonal adjustment (see caveats at the end of this post). Long and medium term trends always agree comparing the adjusted to the unadjusted data - it is the short term trends and month-over-month change where the conflict occurs.

And finally, as retail sales can be a component of determining a recession start date, the zero line of the graph below could be an indicator a recession was underway (or about to begin).

Retail Sales - Recession Watch Graph

Caveats On Advance Retail Sales

This data release is based on estimates. However, the estimates have proven to be fairly accurate although tend to miss at economic turning points. Therefore up to three months are subject to backward revisions, although normally slight, can sometimes be modest.

The data in this series is not inflation adjusted - and Econintersect adjusts using CPI less shelter CUSR0000SA0L2. The St. Louis Fed also inflation adjusts the Census seasonally adjusted data. The last two recessions began as the inflation adjusted retail sales crossed the zero growth line.

As in most US Census reports, Econintersect does not agree with the seasonal adjustment methodology used and provides an alternate analysis. The issue is that the exceptionally large recession and subsequent economic roller coaster has caused data distortions that become exaggerated when the seasonal adjustment methodology uses more than one year's worth of data. Further, Econintersect believes there is a New Normal seasonality. Using data prior to the end of the recession for seasonal analysis could provide the wrong conclusion.

The impact of the monthly retail sales data on GDP is not straight forward. Real GDP (of which the consumer is over 60%) is adjusted for inflation. Further, GDP is an analysis of quarter-over-quarter or year-over-year growth, while retail sales is a monthly data series.

Econintersect determines the month-over-month change by subtracting the current month's year-over-year change from the previous month's year-over-year change. This is the best of the bad options available to determine month-over-month trends - as the preferred methodology would be to use multi-year data (but the New Normal effects and the Great Recession distort historical data).

Those of us who routinely track this series know that the Advance Estimate will be followed by a second estimate next month and a third estimate the month after. How big are those revisions? Are they big enough to warrant skepticism about the Advance Estimate? Here is a visualization of the cumulative change from the first to third estimates from January 2007 through March 2014, the most recent month for which we have three data points.

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